INSIGHT. The life science sector is evolving rapidly and remains an attractive field for investors. New technologies are enabling treatments, diagnostics, and medical devices that were once unimaginable. Scientific breakthroughs and innovative companies are driving the industry forward. But as an investor, how can you identify the most promising companies to invest in? Tor Sander, an analyst at the investment firm Sciety, shares insights into how Sciety identifies leading life science companies – and how you, as an investor, can be part of the journey.
Why do you find life sciences investments so compelling?
What makes life sciences investments unique is that they combine strong business potential with significant societal impact. A common thread among the companies we invest in at Sciety is that their solutions can improve or extend people’s lives. This could involve new treatments for serious diseases, more accurate diagnostic methods, or technological solutions that make healthcare more efficient. At the same time, there’s considerable market potential, as the demand for new medical products and therapies continues to grow.
What does it take to succeed with life science investments?
I’d say there are two fundamental factors: analysing a large number of companies, and truly understanding the industry – which is key to understanding the companies themselves. Life science is a complex field with high technical and scientific barriers, so deep expertise is essential for evaluating the promise of a treatment or product.
At Sciety, we analyse hundreds of companies every year, but only select a handful to invest in – typically around six per year. Our selection is based on thorough analysis, where we assess the companies’ clinical data, financial potential, and operational capabilities. Our process is similar to the due diligence conducted by venture capital firms ahead of an investment.
To make this possible, Sciety has a team with broad and in-depth expertise in life sciences – including experience in clinical practice, drug development, market analysis, and company building. This level of expertise allows us to gain a much deeper understanding of what these companies can achieve.
What role does Sciety’s network play in your investment process?
Our network is absolutely crucial. In life science, it’s not just about numbers and business models – scientific quality and the regulatory landscape are just as important. That’s why we have a broad network of experts, including specialist physicians, researchers, and experienced entrepreneurs, as well as key individuals within Big Pharma, leading MedTech companies, and investors with deep industry knowledge.
This mix of expertise allows us to evaluate a company from multiple perspectives – from clinical relevance and the regulatory pathway to commercial strength. When we evaluate a company in a specific therapeutic area, we can quickly get input from leading doctors and researchers to validate the technology, while also discussing market potential and scalability with decision-makers at established
life science companies. These insights are incredibly valuable in making well-informed investment decisions.
How do you find the companies you choose to invest in?
At Sciety, we have developed a unique process to identify the most promising companies. With the help of our extensive database of life science companies, we can monitor their progress and invest when they reach certain critical milestones. We often follow companies over a longer period before investing, which gives us a thorough understanding of their potential and operational capabilities.
Many of the companies we look at have their origins in academic research or industry and have already made significant progress in their development. These may be research groups that have spent years developing and refining a technology before taking the step to start a company to commercialise their discovery. We maintain ongoing contact with researchers and entrepreneurs who have experience in transforming their discoveries into successful businesses. Through our network in academia, science parks and research environments, we stay up to date on the people and teams driving the development of new technologies and products. This enables us to identify high-potential companies at an early stage and support them on their growth journey.
What defines a strong company?
At Sciety, we consider several key factors when evaluating a company’s prospects. First, the company must offer an innovative solution that challenges existing alternatives and delivers real value. We also evaluate the market opportunity and the regulatory landscape – is there a clear path to approval and commercialisation?
The management team is another critical component. Do they have the right experience, skills, and determination to build a successful business? We also assess the business model and how appealing it is to potential acquirers, such as large pharmaceutical, MedTech, and diagnostics companies. In this industry, many transactions occur well before a product or drug reaches the market – often at high valuations. That’s why it’s not just about developing a product, but also about the possibility of to becoming an attractive M&A candidate.
The combination of a capable team, a compelling business model, and strong market positioning helps us identify companies with the ability to create significant value. Beyond capital, Sciety brings expertise and an extensive network. We open doors to strategic partnerships, customer introductions, and other key opportunities – including access to advisers with deep knowledge of specific markets. This added value allows us to attract top-tier companies and secure investments on favourable terms.
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